 The Q4 2025 Commercial Snapshot outlines how shifting capital priorities, resilient demand in key sectors, and cautious credit conditions are shaping investor strategy and creating clearer pathways for disciplined growth in the year ahead.
The Great Commercial Real Estate Reset: A Massive Wealth Transfer in Motion (November 2025) While headlines fixate on housing affordability and residential mortgage rates, a much larger storm is forming in the background—the dramatic collapse of the commercial office market. Since the pandemic fundamentally altered workplace dynamics, companies have discovered that remote and hybrid work models not only maintain productivity but significantly reduce overhead costs. Entire downtown cores, once bustling with daily commuters and lunchtime crowds, now sit disturbingly empty. As of November 2025, office vacancy rates in major U.S. cities have surpassed 20 percent, with some metropolitan areas like San Francisco reaching 22-23 percent. Even more alarming, office loan defaults just hit a historic 11.8 percent in October 2025—higher than at the peak of the 2008 financial crisis. Buildings once valued at hundreds of millions are now trading at pennies on the dollar. A 40-story Manhattan tower that sold for $328 million a decade ago recently went for under $10 million at auction—a staggering 97 percent loss in value. This isn’t a local problem or a temporary downturn—it’s a global structural shift that could reshape wealth distribution, urban housing markets, and city economies for decades. The question is no longer whether commercial real estate will collapse, but rather who will be positioned to capitalize when the dust settles. This comprehensive analysis examines the crisis unfolding in real-time, the massive wealth transfer already in motion, and the strategic opportunities emerging from this unprecedented market dislocation.
Data Centers Drive Momentum as Office Faces Uneven Recovery Seyfarth’s real estate team provides a bird's-eye view of the current state of commercial real estate throughout the country—highlighting which markets and major asset types are active, slowing down, or experiencing shifts. Seyfarth’s Take: What to Know  Opportunities : Data centers are the strongest asset class nationwide, with broad activity in markets from Atlanta to Seattle. Multifamily remains resilient in Boston, Dallas, Los Angeles, and New York, while industrial shows consistent strength, led by Houston and New York. Challenges : Office remains under pressure across the board. There are pockets of optimism in New York for Class-A, and San Francisco is showing early signs of a rebound tied to AI-driven growth and return-to-office requirements. Tariffs and rising construction costs continue to complicate the landscape. Market Trend : The digital economy will continue to drive supply/demand in data centers, while tariffs may shift the industrial asset class. Reduced interest rates will likely drive an increase in year-end CRE deals.
 The Q4 2025 Commercial Snapshot outlines how shifting capital priorities, resilient demand in key sectors, and cautious credit conditions are shaping investor strategy and creating clearer pathways for disciplined growth in the year ahead.
 The Q4 2025 Commercial Snapshot outlines how shifting capital priorities, resilient demand in key sectors, and cautious credit conditions are shaping investor strategy and creating clearer pathways for disciplined growth in the year ahead.
